Financial Services and Markets Act 2000

Updated on Nov 26, 2023

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Citation 2000 c.8ff		Royal assent 14 June 2000

Long title An Act to make provision about the regulation of financial services and markets; to provide for the transfer of certain statutory functions relating to building societies, friendly societies, industrial and provident societies and certain other mutual societies; and for connected purposes.

The Financial Services and Markets Act 2000 (c 8) is an Act of the Parliament of the United Kingdom that created the Financial Services Authority (FSA) as a regulator for insurance, investment business and banking, and the Financial Ombudsman Service to resolve disputes as a free alternative to the courts.

The Act was considerably amended by the Financial Services Act 2012 and the Bank of England and Financial Services Act 2016.

Some of the key sections of this act are:

Part I The Regulator

Section 1A outlines the regulatory objectives of the Financial Conduct Authority: (a) market confidence; (b) financial stability (c) public awareness; (d) the protection of consumers; and (e) the reduction of financial crime.

Section 2A establishes the Prudential Regulation Authority

Part II Regulated And Prohibited Activities

Section 19 requires firms to be authorised to conduct regulated activities.

Section 21 makes it a criminal offence to issue a financial promotion (an invitation to engage in investment activity) in the United Kingdom unless it is issued or approved by an authorised firm or exempt via the Financial Promotions Order.

Part III Authorisation and Exemption

Part IV Permission to Carry on Regulated Activities

Part V Performance of Regulated Activities

Section 59 states that a person cannot carry out certain controlling functions in a firm without approval by the FSA.

Part VI Official Listing

Section 71 allows private persons to sue a firm for damages if a person performing a controlled function is not approved.

Part VII Control of Business Transfers

Part VIII Penalties for Market Abuse

Section 118 concerns market abuse.

Part 8A Short selling

Part IX Hearings and Appeals

Section 132 establishes the Financial Services and Markets Tribunal.

Part X Rules and Guidance

Section 138 grants the FSA rule-making power.

Section 150 allows private persons to sue for damages if an authorised firm has breached certain rules.

Part XI Information Gathering and Investigations

Section 165 gives the FSA power to return certain information.

Part XII Control Over Authorised Persons

Part XIII Incoming Firms

Intervention by Authority

Part XIV Disciplinary Measures

Part XV The Financial Services Compensation Scheme

Section 213 establishes the Financial Services Compensation Scheme.

Part 15A Power to require FSCS manager to act in relation to other schemes

Part XVI The Ombudsman Scheme

Section 225 establishes the Financial Ombudsman Service.

Part XVII Collective Investment Schemes

Part XVIII Recognised Investment Exchanges and Clearing Houses

Part 18A SUSPENSION AND REMOVAL OF FINANCIAL INSTRUMENTS FROM TRADING

Part XIX Lloyd’s

Part XX Provision of Financial Services by Members of the Professions

Part XXI Mutual Societies

Part XXII Auditors and Actuaries

Part XXIII Public Record, Disclosure of Information and Co-operation

Part XXIV Insolvency

Part XXV Injunctions and Restitution

Part XXVI Notices

Part XXVII Offences

Section 397 makes it a criminal offence to mislead a market or investors.

Part XXVIII Miscellaneous

Part XXIX Interpretation

Part XXX Supplemental

References

Financial Services and Markets Act 2000 Wikipedia

(Text) CC BY-SA

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References